by nilammasri ja’afar senior vice president/head micro finance asia microfinance forum
Post on 31-Dec-2015
40 Views
Preview:
DESCRIPTION
TRANSCRIPT
By Nilammasri Ja’afarSenior Vice President/HeadMicro Finance
Asia Microfinance Forum4-8 August 2014Shanghai, China
Role of State Owned Banks in Financial
Inclusion
Bank Simpanan Nasional – Your Community Bank
2
Regulated & Supervised by Ministry of Finance and Bank Negara Malaysia
BSN’s Objectives:• Promote and mobilise
savings, particularly from small savers
• Inculcate the habit of thrift and savings.
• Provide an avenue for savings to the general public.
• Utilise excess funds of the Bank to help finance economic development of the nation
Established under the Act of Parliament 146 - Laws of Malaysia
1974.
BSN Today – An Overview
3
59 Micro Finance Centres
401 Branches 100% nationwide coverage
899 ATMs
6,800 Employees
344 CDMs
10 Mobile Banking Units85 Islamic branches
5,300 agents
> 8.5 mil customers> 0.7 mil SMS Banking Users> 0.35 mil Internet Banking Users
Financial Inclusion : BSN’s Driving Agenda
4
• Under-served communities
• Non- urban areas
• Non-economical areas
• Low population
Mandated to BSN ;
Providing Financial Access
A better way…
Cheaper cost to serve
Scalability
Reach
Financial services to micro entrepreneurs – viable middle to lower
income businesses
BSN Agent Banking: Innovation in Extending Access to All
5
Customers visiting branches
Normal Practice
Bring BSN to the Community Innovative
Idea
• Online• Real-time
Form-based Manual input Fixed line Longer process Less Coverage
Formless Automated Wireless
GPRS Simplified
process Increased
coverage
Services: Savings & Deposits, Bills & Loans Payments, Remittances &
Cashless Payments
BSN Agent Banking : Cost Effectiveness
6
ITEMS COST
Set-up Cost(One-off)
MYR4,800(USD1,487)
POS TerminalSignage
Point-of-Sales Materials
Yearly Operating Cost MYR1,950(USD605)
MaintenanceNetwork Access Fee (GPRS)
Thermal Paper
Total Cost (First Year) MYR6,750(USD2,092)
Costs
BranchesATM-OffPremise
Agent Banking% Cost
Savings – Agent
Banking VS Branches
MYR / USD
Set-up Cost(One-off) MYR500,000
(USD155,000)MYR45,000
(USD14,000)MYR5,000
(USD1,500)99.04%
Yearly Operating Cost MYR250,000
(USD78,000)MYR40,000
(USD12,400)MYR2,000(USD600)
99.24%
1 Brick-and-Mortar Branch
100 Innovative Agent Banking Outlets
Agent Banking Set-up Cost Cost Comparison – Branch VS ATM-Off Premise VS Agent Banking
Cost Effectiveness : Branch VS Agent Banking
BSN Agent Banking & Sustainable Development
7
Supports the Government ‘s National Agenda• National Blue
Ocean Strategy (Cost effectiveness, rapid expansion, high impact)
• Financial Inclusion
Expansion & development of local communities• BSN agents are
also agents of growth in their own communities
• Knowledge of IT and banking
Reduces BSN’s carbon footprint• Reduces setup
of brick-and-mortar branches
• Carbon-friendly as less emission of CO2.
The Nation Communities & BSN agents
Environment BSN
BSN Agent Banking : Effective Coverage
8
Un-served12
Served388+495
99% 1%
Total
Sub-District
895
Un-served507
Served388
43% 57%
Total
Sub-District
895
Before BSN Agent Banking After BSN Agent Banking
By end 2014, BSN would have covered 100% of the Sub-Districts in Malaysia, with an additional 1,000 agents to be appointed.
BSN Micro Finance : Agents of Social Economic Change
Assists the poor to generate income & employment via self employment i.e. micro enterprises.
Ultimate objective is to alleviate the poor out of poverty.
Micro Finance is viewed as a development approach that provides financial as well as social intermediation.
9
The other key objective is to transform fledgling micro enterprises into the next level i.e. SMEs
Most Establishments in Malaysia are Micro Enterprises
10
• Micro Enterprises comprised 77% of all SMEs in Malaysia
• Employs 1.3 million workers or 36.5 % of all SMEs
• Average 3 workers per establishment
SourceEconomic Census 2011, Profile of Small and Medium Enterprises by Department of Statistics, Malaysia
But Majority of Micro Enterprises are Self Funded…..
11
Sources of financing by size of SMEs, 2010Only 17.4 % of micro enterprises relied on financing from financial institutions (FIs)
SourceSME Census 2011, Department of Statistics, Malaysia (DOSM)
Micro enterprises lacked financing from FIs
due to :-
Lack supporting documents-no proof of income & expenses
No collateral High transaction cost-
small loan sizes
BSN Micro Finance : Government Mandate
12
The National SME Development Council (NSDC) mandated BSN to be a specialized Micro Finance (MF) institution in 2006.
BSN launched its MF Program on March 15, 2007, to provide financing facilities to viable micro enterprises.
Key Deliverables of BSN Micro Financing Scheme
13
Small Financing Amount
Funding for Business Purposes
Easy
FastConvenient
Financing Amount From RM5,000 To RM50,000
• No Collateral• Minimum
Documentation• Simple
Financing Procedures
• Approval - 6 Working Days
• Disbursement - 4 Working Days
• Widely Accessible
• 59 Dedicated MFC
• 401 Branches
• 5,300 EBB
• Financing to All types of Micro Enterprises / Self-employed Individuals
BSN Micro Finance Scheme : More Than Just Loans...
14
Besides providing credit facilities, BSN also extends:-
Savings Access -• Customers required
to save via regular monthly deposits
Insurance/Takaful Protection• Covers loans in
cases of death or total permanent disability.
• Additional monetary benefits for customers (optional)
Advisory services
Capacity building & skills training programs
Instilling financial discipline & record management
Business & loans counseling
Credit clinics
BSN Micro Finance Scheme: Building a Sustainable Portfolio
15
• Financing facilities are offered on market rates
• Effective selection & screening process- loans/financing are extended only to viable micro entrepreneurs
• Leveraging on existing Bank network of 401 branches and 5,300 EBB agents for:- Deposits Loan repayment Sourcing of new credit
applications
• Collaboration with governmental agencies for capacity building programs
BSN Micro Financing : Creating Positive Impact
16
Micro enterprises gained in terms of:-
• Income & asset growth
• Creation of new jobs in local communities
• Expansion- new markets/products
• Graduation to the next level of SME
Pre Financing Post Financing
Financial Inclusion Agenda: Current Strategic Direction
17
Agent Banking
(EBB)
Micro Finance
(MF)
Synergy
Providing MF to the appointed
EBB for business
expansion
Existing MF customers to become
EBB
Current Status
18
MF
• 59 dedicated MF Centers• Over RM800 Million disbursed to
39,000 Customers• RM380 million loans outstanding
balance @ 44% of M’sia MF market share among Banks
EBB
• 5,300 active agents• Over 11.5mil transaction count
• More than RM990 million transaction amount.
579 EBB / MF Customers (11%)
Distribution Centers for
MF Customers
MF Loan Collection
Access Points for MF Loan
Application
Cross Sell other MF
Customers Products
Strategic Collaboration- Moving Forward
19
EBB
M F
20
THANK YOU
BSN… Your Community Bank
top related